Forming a Vermont LLC is Easy

You can set up a Vermont LLC (Limited Liability Company) yourself by filing the Vermont Articles of Organization with the Secretary of State. The cost to create an LLC in Vermont is $125.

Follow our free How to Start an LLC in Vermont guide below to get started today.

Step 1: Create A Name For Your Vermont LLC

First off, in order to launch a successful Vermont LLC, you need to give it a name. Your business name needs to be catchy for branding purposes and legitimate for legal purposes. We go into depth on this topic in our LLC naming guide, but we’ll go over the legal basics below.

If you’re having trouble coming up with a name that captures your brand, don’t let that stop you from forming your LLC. For now, you can focus on the legal requirements and consider applying for a trade name after you’ve nailed down your branding.

What To Do:

Once you’ve decided what you’d like to call your LLC in Vermont, do a business name search to find out whether or not it’s in the cards. If your business name is available, you’ll be able to lock it down when you file your Vermont LLC Articles of Organization.

Need help naming your LLC? Check out our LLC name generator to find the best name for your LLC.

Quick Note: Before you commit 100% to a name, you should see if there’s a decent URL available. Use GoDaddy to search for your options. If there’s a quality domain name for purchase, we advise buying it right away because even if launching a business website isn’t on your radar right now, it’s going to be soon.

Service provided by GoDaddy.com

After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free

Step 2: Appoint A Vermont Registered Agent

Your registered agent will be responsible for receiving important legal documents like tax forms and service of process notices on behalf of your Vermont LLC. Your registered agent can be an individual resident of the state or a company that’s legally authorized to represent businesses in Vermont.

Vermont does give you the option to act as your own registered agent, but many business owners choose to appoint a professional instead. Here are a few things to think about before you decide to act as your own:

You’ll have to maintain normal (9 am - 5 pm) business hours at the address you provide.

If you run your business from home, you’ll be required to make your personal address public.

You must keep up on important notices, dates, and deadlines.

You could be served in front of your family or coworkers.

What To Do:

If you’re considering acting as your own registered agent, do some research, starting with our registered agent guide. If you decide you’re up for the task, go ahead and list your own name and address on your Vermont LLC Articles of Organization.

If you’re leaning toward hiring a professional, we recommend doing so through an online LLC formation service. Many of these companies (like ZenBusiness) offer up to one year of registered agent service free when you form your LLC with them.

Step 3: File the Vermont LLC Articles of Organization

Now it’s time to officially form your LLC by filing your Articles of Organization with the state of Vermont. You can do this on your own, with the help of a lawyer, or through a professional LLC filing service.

What To Do:

If you choose to complete this step on your own, you can either file using the Vermont Secretary of State Corporations Division website or fill out a hard copy of the form and mail it in. The filing fee is $125. If you choose to mail in a hard copy, send the form and payment (payable to the Secretary of State) to the following address:

Processing time is 1 to 2 business days if filing online and 7 to 10 business days if filing by mail.

Sure, you can handle this step on your own, but we still recommend considering the help of an LLC formation service. Why? Not only will they take the reins and make sure you file everything properly, but they’ll also provide other necessary products and services at very competitive prices.

One great option is ZenBusiness. In addition to great service, they give you a free year of registered agent service when you sign up.

Step 4: Create A Vermont LLC Operating Agreement

Creating a Vermont LLC operating agreement is the only way for you and your members to fully define your roles and lock down your LLC’s management and ownership structure. Having this document in place will also give you all something to return to if a dispute or lawsuit arises.

Your operating agreement should outline the following:

each member’s responsibilities

how new members will be admitted

how existing members may transfer or terminate their membership

how profits and dividends are to be distributed

From there, you can add as many provisions as you want, provided they are not in conflict with Vermont business law. Learn more about Operating Agreements in Vermont.

Quick Note: Download a template of create a custom Free Operating Agreement using our tool on How to Start an LLC. No credit card required, ever.

Step 5: Obtain An EIN (Employer Identification Number) For Your LLC

The Employer Identification Number (EIN), Federal Employer Identification Number (FEIN), or Federal Tax Identification Number (FTIN), is essentially a Social Security number (SSN) for your company. State and federal agencies use this number to track your business activity.

Your EIN will come in handy when it’s time to:

Open a business bank account

File Federal and State taxes

Hire employees

We think the best way to get an EIN for your LLC in Vermont is by using the free online application on the IRS website. We prefer this method because it’s the most efficient, but if you’d prefer to apply via phone, fax or mail, read through our guide, How to Get an EIN, to find out how.

Maintain Your LLC's Personal Asset Protection

Using dedicated business banking and credit accounts is essential for personal asset protection.

Now that you’ve made it through the formation process for your Vermont LLC, you’ll need to take steps to protect your personal assets and establish your business as an independent entity.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your Vermont LLC is sued. In business law, this is referred to as piercing your corporate veil.

You can go a long way in protecting your assets with these three steps:

A business bank account separates your personal assets from your company's assets, which is necessary for personal asset protection. A designated business bank account also makes accounting and tax filing easier.

Make sure all documents are signed by a representative of your Vermont LLC and not by you (or other LLC members) directly. This will help separate you from liability incurred by the LLC.

Reduce the Liability of Your LLC in Vermont

Business Insurance

Business insurance helps you manage risk and focus on growing your LLC in Vermont. Carrying the right coverage protects your LLC from liability and keeps you safe in the event of a loss.

The most common types of business insurance are:

General Liability Insurance: A broad insurance policy that protects your business from lawsuits. Most small businesses get general liability insurance.

Professional Liability Insurance: A business insurance for professional service providers (consultants, accountants, etc.) that covers claims of malpractice and other business errors.

There are free services available that quickly assess your business’s insurance needs. These services suggest customized policies with various insurance carriers so that you can choose the best value. One such reliable service is CoverWallet.

Labor Law

You can reduce your LLC’s liability by being fully compliant with employment laws such as:

If you plan to hire employees, you might also be required to invest in Workers' Compensation Insurance. This type of policy provides coverage for employee job-related illnesses, injuries, or loss of life.

Stay Compliant

As a new LLC in Vermont, you will need to stay compliant with permits, licenses, taxes, and state filings. This is serious business; failure to comply can lead to fines, tax penalties, and dissolution (the end) of your LLC.

Business Licenses and Permits

To operate your Vermont LLC, you must comply with federal, state, and local government regulations. The details of business licenses and permits vary from state to state, so make sure you research carefully and plan accordingly.

Vermont LLC Annual Report

Vermont requires all LLCs to file an annual report. If you miss state filings like the annual report, you could face fines or even automatic dissolution. A quality registered agent service can help protect your assets by keeping track of filing requirements for you.

Due Date: Annual reports are due within two-and-a-half months of the end of your LLC's fiscal year.

Late Filings: Vermont charges a $25 reinstatement fee for reports submitted after the filing deadline. In addition, Vermont can revoke an LLC’s registration for failure to file an annual report.

Fee: $35

Reduce Administrative Burden

There will be lots of demands on your time once you start your business. With that in mind, it’s a good idea to streamline your workflow and reduce administrative overhead from the get-go.

Accounting For Your Vermont LLC

It's important to get your books in order — even if you haven't officially opened for business. A well-managed accounting system will help you:

Track your business finances, including bills, expenses, and income.

Simplify and file your annual taxes.

You can maintain your accounting in two ways:

Use DIY accounting software. This can come with an increased risk of errors especially when starting a new business.

Hire an accounting service. They can provide comprehensive advice to help optimize your bookkeeping and taxes as well as additional services such as payroll etc.

Recommended: For most small businesses, we recommend using a reputable accounting service. Schedule a free tax consultation for your business now to avoid costly errors in the future.

Employee Payroll

If you have employees for your Vermont LLC, a payroll service will save you a lot of time and also save you from having to become an expert on state compliance or employee tax withholdings and filings.

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